Business Advice: Is it time for a review?

Mike Coates, managing director of Newton Aycliffe-based Commercial Expert, delivers some sound financial advice as we approach the end of another year…

With rates at an all-time record low, both in residential and commercial markets, is it time to review your commercial borrowings?

The majority of lenders have passed on the recent Bank of England Base Rate reduction and as a consequence LIBOR (London Inter Bank Offered Rate) has also reduced making borrowing money cheaper than ever before.

Fixed rates are ludicrously low, particularly five-year fixed rates. It may be that your existing facilities need a review or in many cases a refresh.

The gap between high street lenders rates and new challenger lenders has closed, and with the addition of ‘new blood’ in the market, lenders like ATOM Bank are leading the way and offering market leading rates and incredibly low arrangement fees.

Loan to values have also increased across all lending and in many cases lenders are looking at clients much more flexibly than in recent times, this is very encouraging, and means that banks have an improved appetite to lend.

All business can benefit from a lower rate, whether it is an overdraft, invoice discount facility or commercial mortgage, but always consider the costs to move or change, arrangement fees and disbursements may out-strip monthly savings.

If you haven’t already, take a close look at you financial paperwork, it may be now is the right time for a commercial review.